Failing to Warn of Risk of Loss

The Court of Appeal of California has ruled that a lawyer may be sued for failure to warn a client that the failure to settle a claim against the client  would put the client at risk for paying the adversary’s attorneys fees.  The Court held that it was not appropriate to dismiss the client’s claim against the attorney on that issue, and remanded the case to the trial court for consideration of the merits.

There is no need to state all of the facts here, but suffice it to say that the plaintff was upset about having the pay their original adversary’s attorney’s fees of over $600,000 (and their own attorney over $350,000) in a dispute that originally involved less than $20,000.

The case is Charney v. Cobert, B188087 (Cal. Ct. App. Div. 7 11/28/06); read it here.